Tata Consultancy Services Limited, also known as TCS, is the largest IT company in the country. TCS is engaged in providing solutions in information technology (IT) services and other digital and business-critical and oriented software solutions. TCS has a stronghold and reaches the BFSI sector, which stands for banking, finance, and insurance services. It also holds solid connections and operations with consistent growth in manufacturing, retail, media and entertainment, energy, resources, consumer packaged goods, telecom, and other utilities. It is also engaged in life science and healthcare, travel, transportation, s-Governance, and hospitality sector. In this article, we take a closer look at the TCS Buyback Details and its possible future prospects.
TCS has a very diversified services portfolio consisting of essential IT and assurance services, cloud services, performance management, business intelligence, industrial services, enterprise solutions, connected marketing solutions, and business process services. TCS has carried out many alliances for the Digital Software and Solutions; some of its collaborations are as follows TCS BaNCS and TCS MasterCraft. among others.
TCS as a whole group is a subsidiary company of the Tata Group. Along with being the Largest IT company in the country, it is also the most prominent IT service provider globally as per the market capitalization. TCS has an extensive geographic presence and footprint. It carries out its business operation in North America, the United Kingdom, Latin America, Continental Europe, and Asia-Pacific as the significant operation center of the company. TCS has over 556,986 employees with 149 locations widespread in 46 countries.
OBJECTIVE OF THE BUYBACK OFFER:
The company stated that the necessity of the Buyback Issue aims at the following:
- The company’s policy is to distribute its surplus funds in favour of the shareholders and increase and improve the overall Return of the shareholders.
- To improve their financial ratios and other operational ratios such as Earnings per share (EPS), Return on Equity (ROE), Return on Capital Employed (RoCE), and Return on assets (ROA).
TCS BUYBACK DETAIL:
| Issue Period | From March 9, 2022, to March 23, 2022 |
| Security Name | Tata Consultancy Services |
| Issue Type | Tender Offer |
| Issue Size (Shares) | 4.00 crores equity shares of the company |
| Issue Size (Amount) | Rs. 18,000.00 Crores |
| Buyback Price | Rs. 4500 per equity share |
| Face Value | Rs. 1 per equity share |
| Listing At | BSE, NSE |
| Buyback Offer Open Date | March 9, 2022 |
| Buyback Offer Close Date | March 23, 2022 |
| Record Date for the offer | February 23, 2022 |
| Last Date for receipt of Tender Forms | March 23, 2022 |
| Finalization of the Buyback Acceptance from the company | March 31, 2022 |
| Last Date for settlement of the bids | April 1, 2022 |
| Last Date for Extinguishment of equity shares | April 8, 2022 |
TCS BUYBACK HISTORY:
| Buyback Date | Share % of paid-up capital bought back | Share Buyback price as per the price per equity share | Total Buyback Amount |
| February 20, 2017 | 2.85% | Rs 2,850 | Rs 16,000 Crores |
| June 15, 2018 | 1.99% | Rs 2,100 | Rs 16,000 Crores |
| October 7, 2020 | 1.42% | Rs 3,000 | Rs 16,000 Crores |
| March 14, 2022 | 1.08% | Rs 4,500 | Rs 18,000 Crores |
MARKET REACTION ON TCS BUYBACK OFFER:
As on the Record Date of the buyback offer being announced by the TCS, the closing price of the TCS on NSE was being recorded with the highest trading volumes. The closing price was Rs. 3,563.80 per Equity Share. The company also stated that a shareholder needs to have 56 equity shares maximum to be classified under ‘Small Shareholders’ and eligible for the buyback offer.
TCS share surged and toped the Nifty IT and the Nifty Index, considering the TCS stock was the only stock that ended and closed with the positive gains amid the Russia Ukraine War tension, which created a bloodbath in the market lately. The TCS stock reached a maximum value of Rs. 3857 and then registered a decline. On the current CMP of 3620, the buyback offer is a premium of around 26.4% per equity share. Check Day by Day IPO Subscription Details (Live Status)
| NSE | BSE | |
| Trading Volume (Shares) on 23rd Feb 2022 | 24,26,203 | 2,09,000 |
| Closing Price | 3,563.80 | 3,565.30 |
The important thing in the buyback offer of the company is its acceptance ratio of it. The company has earlier stated that if in a category, the total buyback been tendered by the quantity exceeds the buyback size of the company, the company’s acceptance ratio will reduce. In the past three buybacks of the TCS, the company has seen 100% acceptance. This time, due to the current inflation and Russia – Ukraine War Crisis, there is a massive gap between the buyback price and the CMP of the company. According to many analysts, the buyback acceptance ratio will be somewhere between 45 and 70 percent. On the other hand, many analysts recommended a buy over a long term over TCS and held on to the stock with a highly positive outlook.
FINANCIAL TRENDS:
| Particulars in Crores | March 2017 | March 2018 | March 2019 | March 2020 | March 2021 |
| Sales | 117,966 | 123,104 | 146,463 | 156,949 | 164,177 |
| Expenses | 85,655 | 90,588 | 106,957 | 114,840 | 117,631 |
| Operating Profit | 32,311 | 32,516 | 39,506 | 42,109 | 46,546 |
| OPM % | 27% | 26% | 27% | 27% | 28% |
| Other Income | 4,221 | 3,642 | 4,311 | 4,592 | 1,916 |
| Interest | 32 | 52 | 198 | 924 | 637 |
| Depreciation | 1,987 | 2,014 | 2,056 | 3,529 | 4,065 |
| Profit before tax | 34,513 | 34,092 | 41,563 | 42,248 | 43,760 |
| Tax % | 24% | 24% | 24% | 23% | 26% |
| Net Profit | 26,289 | 25,826 | 31,472 | 32,340 | 32,430 |
| EPS in Rs | 66.71 | 67.46 | 83.87 | 86.19 | 87.67 |
Also Read : List of Mainboard IPO’s in India.
Also Read : List of Upcoming SME IPO’s in India.
COMPANY CONTACT INFORMATION:
Tata Consultancy Services
9th Floor, Nirmal Building,
Nariman Point,
Mumbai – 400 021.
Phone: +91 22 6778 9696
Email: investor.relations@tcs.com
Website: https://www.tcs.com/
TCS BUYBACK REGISTRAR:
Link Intime India Private Ltd
C 101, 247 Park, L.B.S. Marg,
Vikhroli (West), Mumbai – 400083
Phone: +91-22-4918 6270
Email: tcs.buyback2022@linkintime.co.in
Website: https://linkintime.co.in/
TCS BUYBACK MANAGER:
LEAD MANAGER(S):
JM Financial Consultants Private Limited
REGISTERED BROKER:
JM Financial Services Limited
Email: divyesh.kapadia@jmfl.com
